There's No Concert (with Moscow Never Sleeps)
How NFTs are the perfect 21st century vehicle for money laundering.
Real estate, as I’ve discussed frequently on the PREVAIL podcast and on these pages, is an ideal vehicle for money laundering. Through a shell corporation or in cold, hard cash, you can purchase, say, a duplex on Park Avenue West, and either it flip it right away at a loss, or park it and let it accumulate value. As soon as you sell the property, your money has been “laundered.” While still acquired illegally, the cash from the sale is now free to be used for legitimate purposes.
The drawback with real estate is that, as the name implies, it’s real. Therefore, maintenance costs are involved. First off, you have to buy the property, which means ponying up for the services of high-end real estate brokers and attorneys. You have to pay condominium association dues, and deal with the HOA board. The apartment has to be decorated and furnished, which means interior designers and painters, and regularly cleaned, which means maids. If the toilet clogs or the A/C stops working, you have to hire plumbers and electricians. You have to tip the super and the doorman at Christmas. Someone has to oversee all of this. And so on.
If your property is a house in Malibu or Miami, there are even more things to worry about. The grounds must be kept up, and the roof, and the gutters. Property and school taxes must be paid. The garbage and recycling have to be collected. Just because you’re a Putin-adjacent oligarch doesn’t absolve you of having to pay for that stuff.
But what if there were a vehicle for money laundering involving un-real estate? Intellectual property? All the deliciousness of regular money laundering, but without the calories? Ah, but there is. It’s called a non-fungible token, or NFT. This is basically a digital file that we know to be unique (at least, if we trust blockchain). Usually this is a work of “art.” (Sometimes this “art” is generated by the mother of Elon Musk’s son.) Often it’s the digital version of a baseball card: a 1952 Mickey Mantle, but virtual and singular. These trading cards are usually put out by industrious athletes trying to cash in on both their popularity and the latest fad—or, more famously, by a broke-ass FPOTUS desperate for a new infusion of capital.
And while NFTs are not inherently nefarious, and not all of them are shady—settle down, bros—the format is perfect for laundering money, because the good being sold is not an apartment at the Dakota but something completely made up.
On today’s PREVAIL podcast, Moscow Never Sleeps, an attorney who works in the finance industry and a PREVAIL contributor, explains how this all works, using characters from I Love Lucy in his hypothetical example: Pretend Ricky Riccardo is the crime boss sitting on billions he needs laundered. Lucy creates digital images of her eating chocolate on the conveyer belt. She sells the image rights to Ethel, who creates the NFTs of those images—paying Lucy for the privilege—and then wholesales them to her husband, Fred, who buys them using Ricky’s crypto. He then brings them to market, auctioning them to members of the general public gullible enough to think this is a worthwhile investment. The result of all of this chicanery is squeaky clean cash.
(Remember: Jack Dorsey sold the digital file of the very first tweet for almost $3 million. A year later, the buyer tried to auction the NFT, and the highest bid was $280. Oops.)
The whole enterprise is dizzying and stupid, and at the end of the day, there’s no there there. The oligarch who bought the Upper West Side duplex has a place to crash, if he can evade the sanctions list long enough to spend a weekend in New York. The crime lord who bought the Picasso has a Picasso. The MAGA chud who bought the digital trading card of Trump dressed as a cowboy has…a digital trading card of Trump dressed as a cowboy. Yippee ki-yay, dumbass.
One more layer to the dumb: NFTs are also a multi-level marketing scheme, so with each sale Fred makes, Lucy also takes a cut. If you’re not in that first wave of investors, you’re probably not making money on these things.
“So this is like in the old days,” I suggested to Moscow Never Sleeps, “where concert tickets would get released and the scalpers would buy most of them, and you’d have to get the good seats through the scalpers.”
“Except in this case,” he said, “there’s no concert.”
LISTEN TO THE PODCAST
S4 E14: There’s No Concert (with Moscow Never Sleeps)
The pseudonymous PREVAIL contributor Moscow Never Sleeps returns to the podcast. He talks to Greg Olear about Ron DeSantis in 2024, how NFTs are a perfect money laundering vehicle, SBF and the vanishing of all that money, Ginni Thomas, audits, and “The White Lotus.” Plus: Who?
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Photo credit: Open Clip Art image by Gordon Dylan Johnson.
I looked into NFTs as possible income for my art and right away I thought this is bs. The Republican clown show this week has been highly entertaining with the climax yesterday when tRump received one vote from Rapey McForehead Lmao. Thanks Greg 😎
My shorthand for NFT is "Non-Flushable Turd" and alas, that still holds true!